SUPPLY BILL

Second Reading

Adjourned debate on second reading.

(Continued from 11 May 2010.)

The Hon. I.F. EVANS (Davenport) (11:22): I indicate to the house that I am the lead speaker on this bill. For those new members who have not been involved in a supply bill debate, we are in unusual circumstances, because the bill we are debating today is for a bit over $5 billion to be supplied to the government so that it can run its programs between now and when it brings the budget down in the middle of the football finals in September. The Liberal Party believes that public servants should be paid, so the tradition is that we will ultimately support this bill to supply the government with money.

The first point is that a supply bill debate is always a wide-ranging debate and, because there is no budget attached to this bill, one can essentially address any area of government expenditure, or proposed government expenditure, as part of the debate.

The first issue I wish to address is: why is it that we are not getting a budget from this government until the middle of the football finals in September? The tradition, as the house well knows, is that the budget is brought down in June. In 2007, the budget was brought down on 7 June; in 2008, it was 5 June; in 2009, it was 4 June; and, in 2010, it is going to be in September, in the middle of the AFL football finals.

Mr Griffiths: On 16 September.

The Hon. I.F. EVANS: On 16 September, the member for Goyder advises. The reality is that this is an eight year old government. This is not a new government that has won the election and has come in and said, 'Shock, horror, the budget is in trouble—we need more time to prepare the government's response to the financial position of the state.' This is actually an eight year old government that is essentially saying to the public of South Australia, 'Shock, horror—the finances of the state are in such a position that we need 180 days before we can decide what we are going to do in our budget.'

Compare that to the English parliament. There has just been a change of government there after 13 long years of Labour government in England, and Prime Minister Cameron has agreed to bring down a budget within five weeks. Within five weeks, after 13 years of Labour government, they are bringing down a budget. In the state Labor government here, Treasurer Foley, after eight years of being Treasurer, says to the public, 'What the heck, the finances are in such a bad state, we need another six months to think about what we are going to do, what we are going to prioritise, and how we are going to bring down our budget.'

I think this process is an absolute nonsense. I think it is a disgrace that an eight year old government cannot bring down its budget in the normal time frame, given it was re-elected. I think there would be some leniency if a new government had been elected, but, even then, not six months. All this, in my view, is an opportunity for the government to park all the bad news in the middle of the AFL and rugby finals in the middle of September to try to minimise media scrutiny about the bad decisions that are going to be in this budget.

Make no mistake, Madam Speaker, this budget is going to carry a lot of bad news, and it is going to carry a lot of bad news for South Australia for the very simple reason that the government has been a very poor manager of the economy; a very poor manager of the budget. I will walk through some of the issues where I think the government has been a very poor manager over a long period of time. Let's walk through them one by one; let's look generally at the economic issues.

Under this state government, since coming to government, the percentage share of the national economy that the South Australian economy makes up has actually declined. Our share of the national economy has declined from 6.8 per cent to 6.5 per cent over the term of the Rann government. Our economy, as part of the national economy, is not growing; in fact, it is declining. So, our relevance as a state to the national economy is becoming less, and that is reflected in jobs growth.

The state government has put out this grand vision of having 100,000 extra jobs by 2016, conveniently, two years after the next state election, as a measuring point. It has also announced in the Governor's speech that there will be 100,000 trainees over the similar period. The question is: how many of the 100,000 trainees, mainly being funded by the federal government, are going to be counted towards the 100,000 job target being promoted by this government?

The reality of jobs growth is that, if South Australia had kept pace with the national jobs growth, we would have 25,000 more jobs in South Australia. So, while the Rann government runs around saying what a good job it has done in relation to jobs growth in South Australia, the reality is that it has delivered 25,000 fewer jobs than it should have had we just kept up with the average throughout the rest of Australia. I think a fair question the taxpayer can ask this government is: why should South Australia accept a below average performance?

Another area where we are below average is in relation to business investment. South Australia had 7 per cent of national business investment when the Rann government came to office in 2002. We now have only 5.3 per cent of national business investment. So, the message there is that not only are we behind in the number of jobs we are also behind in business investment.

My colleague the member for Waite has made some good press releases lately about the level of exports. The level of exports in South Australia is declining. The value of South Australian exports has fallen from $9.1 billion in 2001-02, when the state Liberals were last in power, to just $7.9 billion, and that is without any adjustment for inflation; so, the real value of that would be even less. The reality is that South Australian exports have gone backwards at a rate of knots under this particular government. We can only hope that the self-professed world's greatest agriculture minister can turn that around, given his vast expertise in the matters of locusts and crops. The reality is that business investment has declined, jobs growth has declined, our share of the national economy has declined and our level of exports has declined under the Rann government.

Another issue is our population growth. Mr Rann and the government have been running around supporting a two million population target but the reality is that our population growth over the term of the Rann government has declined. There are a number of figures showing that the Rann government is under-performing compared to the rest of the national economy.

The Rann government quite often makes a comparison between its term of eight years and the previous Liberal government's term of eight years. I want to remind the house of two key issues in relation to the difference between those two economies. The Rann opposition spent over 500 days delaying legislation to sell or lease the electricity assets in South Australia to pay off the State Bank debt. Labor policy was that it did not want the State Bank debt reduced by the sale or lease of the electricity assets. The government also campaigned actively against the GST. These great economic managers who sit opposite would have you believe that they could produce the level of service that is currently being produced in South Australia if they had kept the State Bank debt high and not had the GST revenues.

It is obvious to everyone who has followed this matter that those two key decisions by the Liberal Party (both state and federal) have transformed the South Australian economy. They are the two basic key decisions that have transformed the South Australian economy. It is unrealistic to compare the past eight years with the previous eight years to a degree, because the circumstances are significantly different due to the revenue streams flowing into the government (and I will come back to that later) and also the level of debt that the previous government had.

When we look at the Supply Bill, I think it is fair to look at the performance of the government in a whole range of areas. The taxpayers can ask themselves, 'What do we believe about this government? What do we believe when this government says anything?' This government has a history of making very grand announcements and then walking away from them. I still remember the grand front-page announcement about what I think was an $800 million expansion of the Mount Bold reservoir—nowhere to be seen. I remember Premier Rann's front-page announcement: 'We're going to bulldoze bikie fortresses'—yet to be seen.

I remember the pledge card about lower electricity prices and water prices. In fact, water prices are going to double under the regime of Mike Rann. The government talked about an underpass at the intersection of South Road and Sturt Road, adjacent to my electorate—not to be seen. There has been talk about underpasses along South Road, beneath Port Road and Grange Road—not to be seen. There was an announcement of a tramline to North Adelaide—not to be seen. There was the promise of a solution to the Britannia roundabout—not to be seen. There was a front-page promise of prisons at Murray Bridge—not to be seen. There was the promise of a FIFA compliant Adelaide Oval for only $300 million of South Australian taxpayers' money, or $450 million total cost.

Forgive me if I do not put a lot of faith in what the government says it is going to do. My advice to South Australia is that the only time you can believe that the government is going to deliver something is when you see the first brick go down. Up until then this government will flip and flop all over the place. It simply reacts to the political polling of the day and whatever will deliver a political result the government will deliver. It may not be in the best interests of the state but if it is in the best interests of the Labor Party then it will certainly change its position to deliver it.

During the last election campaign, one only has to look at the number of times that this government simply matched the opposition's promises. In fact, there was a press release put out about following the leader and how the Labor Party was following the Liberal leadership at the time.

I can remember when we announced the desalination plant the minister in control of SA Water at the time (Hon. Michael Wright) said that we did not need a desal plant; it was way too expensive. Of course, we were promising a $400 million desal plant, half the capacity of the one which the government is building but, apparently, that was too expensive and it was not needed. The government saw the polling and instantly changed its position some months later to announce it would build a desal plant, twice the size of that promised and, indeed, more than twice the cost.

You could look at the promise of tasers for police officers where the government copied the opposition. You could look at stormwater re-use and aquifer recharge where the government has copied the opposition's policies. Even in relation to the easing of water restrictions they copied the opposition. In relation to funding for Magill Training Centre and the argy-bargy about that issue, it followed the opposition. The whole Adelaide Oval debate is because the Liberal Party put on the table the issue of an inner city stadium.

This government has simply followed public debate and matched the opposition in a range of areas. Madam Speaker, you have to ask the question: what is its vision? What is its strategy? After eight years in government, can anyone write down what this government stands for, its vision for the state or metropolitan Adelaide? The answer is that you cannot write down the vision because it keeps on changing.

We were going to have $100 million put into Football Park two years ago, because at that stage the government believed in a two-stadium strategy. They said they would put $100 million into Football Park to upgrade the venue for football and they put $25 million of state government money into the SACA stadium to help upgrade Adelaide Oval. Just two years ago this government was saying to all South Australia, 'We are going to have a two-stadium strategy.'

Well, guess what, the polling went pear-shaped for them. People liked the idea of an inner city stadium. All of a sudden the state government's vision for South Australia has changed. Apparently, South Australia will now be the only state going forward with a one-stadium strategy. We will have football, cricket, rugby and concerts at Adelaide Oval, if you believe the Treasurer. There is nothing new about cricket, rugby and concerts at Adelaide Oval. There is actually nothing new at all in that.

What is new is that this government's vision for South Australia is that over the next 20 years we will have just one stadium. Can members name another state with only one stadium? Every other mainland state has two stadiums, and I could even mount an argument that Tasmania has a two-stadium strategy with Bellerive for cricket and the football oval in the northern part of the state, but not South Australia. Apparently, this government's vision is a one-stadium strategy.

I mentioned the election and what you can and cannot believe with the Labor Party. We have to go back to a simple document; that is, the Labor Party's costing document at the election. It was a two-page spreadsheet signed off, essentially, by the Treasurer's own staff. I am sure that the South Australian public had a lot of confidence in a two-page document setting out the costings for the next four years, independently verified by the Treasurer's own staff. It was a laughing stock, and I guess it shows the level of arrogance this government has towards the electorate. In the last days of the election it did not put up any independent costings, as we did, but, rather, it put up costings delivered, essentially, by the Treasurer's own staff.

There has been some comment since the election about the level of GST that the state government is getting. There have been media reports that the state government will get a touch over $700 million extra. I advise the house that the 2010-11 commonwealth budget substantially increased the GST revenue South Australia is expected to receive. The 2010-11 commonwealth budget increases the amount of GST to be provided to South Australia by $1.7 billion. The state government will round that down for adjustments they think will happen through various grant programs, but the reality is that the commonwealth budget shows not that we are getting $700 million more in GST revenue but, rather, $1.7 billion over the forward estimates period for the increase in GST.

I mentioned earlier the lack of control by the state government over economy and budget, and I want to talk about budget matters generally for a while. We now know, of course, that it has been independently verified by two sources: the Commonwealth Grants Commission and the Institute of Public Affairs have now confirmed that South Australia is the highest taxing state in Australia.

So, we are below average on exports, business investment, population and a whole range of other areas, including our share of the national economy. We are below average on all of those, but, Madam Speaker, guess the one thing we are above average on: the one thing that South Australia is above average on is our tax take. We are the highest taxing state in Australia. Why should South Australia accept a below-average economy and an above-average tax take? Why should we accept that? The reason we have it delivered to us is that this government is a poor manager of government services.

You have to go no further than the government's own record and what it proposes to do. What the government proposes to do is cut $750 million out of government expenditure—or, through increased taxes, gain it through revenue—but it has to find $750 million through its Sustainable Budget Commission. The reason it has had to cull $750 million is poor management. After eight years in government it has come to the people and said, 'We have the got the budget in such a mess that we have to cull $750 million from it.'

If you want some examples, you need to go no further than the Public Service itself. The Public Service has increased by about 10,800 positions above budget and outside of areas that we call sensitive areas, such as police, nurses, etc. There are about 10,800 extra public servants at a cost of around $700 million per year. What this government has done over an eight-year period is take its eye off the ball management-wise. The Public Service has increased, and it is now at a point where it will have to cull $750 million out of the budget, and that is why I go back to my initial remarks: the September budget I think will be a very tough budget for South Australia.

However, we should not think that the level of savings or increased revenue measures will just be $750 million. It will be more than that. We are all aware of the shared services concept (centralising services and somehow saving money), and we are aware of other savings measures announced by the government that have yet to be fulfilled. The Treasurer, I think it is fair to say, has indicated that the savings target is no longer just $750 million but about $1.2 billion.

So, why do we have the budget delayed until September? There are two reasons: the budget is delayed until September so that the government can hide the bad news among the football finals—and, possibly, the federal election but, certainly, the football finals—and it has to work out how it is going to make this $1.2 billion in savings.

I mentioned that South Australia is the highest taxing state in Australia, and I want to touch on a couple of examples. Credit goes to the former shadow treasurer for his work in this area, but the Liberal Party announced during the election campaign (in about October, I think from memory) that we would lift the threshold on land tax. There was a lot of angst in the community about land tax. In June 2009, of course, the Treasurer was saying that, given that we were running budget deficits, there was no room to change the land tax provisions. He said on 5 June:

You look at land tax. It's now the No. 1 tax issue in terms of tax agenda. I've had to have a good look at the state's finances. The fact we are running deficits this year and next, it would not be a financially responsible thing to do.'

So, what happens? Typical of this government, it looks at the polling, land tax is an issue (particularly through the eastern suburb seats of Norwood, Morialta and Hartley), so the government changes position. Even though it was still running deficits at the time, even though it is still proposing a deficit next year, it decides to change its land tax policy.

It comes to this: at what point do you believe the government? Do you believe the government when Kevin Foley says, 'We won't change the land tax provisions because we are running deficit budgets,' or do you believe Kevin Foley when he then changes his position some months later down the track? It is a habit of this government that it says whatever it has to say to get it through the media conference that day. The Liberal Party, being the party of low tax, moved the agenda forward and promised land tax reform. The government then announced its policy. We have matched that. We are debating a land tax bill later this week, and the Liberals welcome the changes to the land tax.

We also welcome the government matching us on our payroll tax announcements. We announced taking payroll tax off trainees, apprentices, etc., and the government has matched that after eight years in government. The problem has been there for eight years, but only when the Liberal Party promises it does the government then act. I know and the government knows that it was lobbied pillar to post by the various employment group training schemes that said, 'If you got rid of this payroll tax provision, we would improve our employment of apprentices by about 10 per cent,' was the advice to us. But why did it take the government eight years to react?

There have been some major announcements since the election, and I want to touch on just a couple of them; one is the rents resource tax. While it is not directly a state tax, the mining royalties are, and that would be covered by the matter of supply. The reality is that this Treasurer, our Treasurer, made the assumption that the rent resource tax proposed by the Rudd government was the same as the rent resource tax applying to offshore mining investments. We know that because he told some radio listeners that some weeks ago.

It is a staggering admission from the Treasurer to say that he assumed that it was the same as the offshore provision given that, when the health reforms were debated, they were briefed at the COAG meeting about the Henry tax review. How did our state Treasurer get it so wrong on the rent resource tax? Asleep at the wheel, concentrating on other issues. But in terms of the single biggest development in South Australia, the Roxby Downs development (which we all know premier Rann lobbied against for years, and now he is in government he is supposedly a strong supporter), when the rent resource tax was proposed, the Treasurer of the state assumed that it operated differently than it does.

I cannot believe that they did not ensure they were properly briefed from day one and had a clear understanding of that issue. My prediction to the house is that prime minister Rudd will back down on that tax; he will significantly change that tax. It is a classic example of the Labor Party announcing a decision, consulting afterwards, finding out the bad news and having to backflip, and members can understand why people have lost confidence in the Rudd government, given its continual change of position.

The other issue I wish to tackle is the new health agreement. I wish to tackle only one issue on that today; that is, this principle that the state will hypothecate, essentially, about 30 per cent of its GST revenue. I think that personally this is a very bad precedent for state governments to adopt. I think that the Western Australian model achieves the same outcome essentially but delivers more independence for the state.

The problem I have with the government's position is that, once you hypothecate it for health, when the federal government comes to you about the environment, education or mental health, or whatever the politically popular agenda is in five years by whatever centralist prime minister happens to be in Canberra at the time, you have given up the principle that the states are not prepared to hypothecate the GST. The states fought hard for the GST. It was always a windfall gain for the state parliaments to have some independence about some money they could spend on programs they wanted. I think it is a bad precedent to set; that is, the hypothecation of the money with regard to the health fund.

The other issue is the mixed message from the government. The Premier said that none of this money in the new health arrangement would be going to the new hospital—none of it at all. 'We've negotiated this brand new deal but nothing is going to the capital for the new RAH.' Then, about three weeks after the announcement, out comes the backflip, out comes the change of position—and guess what? Apparently the state government is going back to the commonwealth to see whether it can negotiate some capital for the RAH. Again: tell the public one thing, change your mind and try to renegotiate your position.

The last thing I will touch on is the Adelaide Oval stadium. I want to make some comments in relation to this because I think it is an issue that warrants particular attention, given the public debate we are having. I want to make some comments to the South Australian football community. I declare that I am and always have been a member of the Sturt Football Club as a past player. I have a son who plays for them. Members of the South Australian football community are contacting us on a regular basis. That has increased greatly in the last few weeks, given the confusion. The football community is very concerned that the government is using the South Australian football community and setting this project up to fail, and then it is going to use the South Australian football community to wear the odium. That is what the football community is concerned about.

There are a number of conditions that football requested in this particular project that the government appears to be walking away from. One of them was that the football community would control the stadium for six months of the year during the football season. We now know that the stadium management authority is going to manage the stadium, not the football community, during that six month period. The football community entered the debate on the basis that there be no extra cost to them. No; they would not be responsible for any budget overrun. Yesterday, the statement to the house said that the government is putting in $535 million and football and cricket will be responsible for the budget overrun. That is not how football entered these negotiations.

My understanding is that there was an agreement from football that they would enter negotiations on the basis that there was a car park facility for 3,800 car parks. This morning the Premier is saying, 'There is no car park.' My question is: is the government setting this project up to fail and is it going to let football wear the odium? That is football's concern. My message to football—and I have been involved in football since 1976 at the SANFL level—

Mr Kenyon interjecting:

The Hon. I.F. EVANS: Premiers, Tom. My message to football is: if whatever the government is offering you by way of the new deal at Adelaide Oval is not in the best interests of football, walk away, because the taxpayers will not blame football. The taxpayers, quite rightly, will blame the government. Football should not fear the government's promise that it will not put money into another stadium. They should not fear that threat because the record of this government is, if the polling shows it is popular, it will change its position and fund it. Evidence: only two years ago this government was saying to this parliament, 'Football Park is the future of football. Football Park is where it is all going to be. We are going to spend $100 million and upgrade it.' There were trams heading down that way, if I recall. The government had the vision for Football Park. Let football be under no misunderstanding about how this government operates. It may well say one thing today, but do not think for a second it will stand by it tomorrow.

The Hon. S.W. Key: We love football.

The Hon. I.F. EVANS: The member for Ashford said, 'We love football.' The reality is that it is the government's decision to do what it is doing. I make the point to the football community: you will only get to make this decision once. Don't get locked into something that you are not convinced is in the best interests of your sport. I remember the division in the 1970s when they decided to go down to Football Park. I remember the hard work that has been done over decades building that facility.

The government, for crass political purposes, should not come crashing in over some sport just for the base political purpose of gaining a vote. The votes happened, you have government, that does not mean that you have to trash the sport. I say to football: have the courage to make one decision and one decision only, and that is, if it is not in the best interests of football, walk away; walk away with your head held high because you have acted decently and honourably in the negotiation. It is not football that has changed the rules: it is this government.

The great fear in the South Australian football community is that this government is setting them up to take the fall if the project does not go ahead. That is the fear in the football community, and I say to them: have the courage to make the decision that is in the best interests of football; the taxpayers will not blame football. In time, this government will come back to the negotiating table and renegotiate yet another deal.

I do not believe for one minute the government threat that it would not put money into another stadium. I am still looking for the Mount Bold reservoir expansion; I am still looking for the prisons at Murray Bridge; I am still looking for the $100 million the government was going to put into Footy Park. This government changes its mind every day of the week, depending on which way the polls blow. The football community can have confidence that the only consistent thing about this government is its inconsistency.

I do not wish to hold up the house any longer. We are supporting the Supply Bill because we accept the fact that the public servants and government programs need to continue, but I think it is a disgrace and damn near an abuse of process that a government that has been re-elected needs another six months to sort out its own mess and bring down a budget in September for scrutiny, at the height of footy finals. I think it is treating the South Australian public with contempt.

The Hon. R.B. SUCH (Fisher) (11:57): I rise to support the Supply Bill because, as we know, we need to pay our public servants, and others. The first point I would make is that it is concerning that this government—the recently re-elected Rann government—seems to have run out of puff; it has lost its mojo, in my opinion, and I am not talking about the Austin Powers type of mojo, I am talking about the magic power or spell. There does not seem to be any excitement, or vision, or passion, coming out of the government, and that is despite some additions or incorporations into the cabinet. Hopefully the Attorney-General and some others will, over time, reinvigorate this government because, in my view, it has come almost to a grinding halt.

In terms of specifics of finances, I have an uneasy feeling about the forthcoming budget. I have this feeling that we are in for a rough time with the budget, which will come down at about the same time that Carlton will win the premiership, and I say that as a long time supporter of the mighty blues. This concern is reinforced, I think, by what we are seeing in relation to promises and projects which are being adjusted or not proceeded with. It is unfortunate—it is a consequence of the election—that the budget is so far into this year. The year will be almost over by the time we get to have a look at it.

We have a Sustainable Budget Commission, and I think it is incumbent on anyone who uses that term to define what they mean by 'sustainable'. It has become a buzzword. When I go to functions and people use that word, I have a habit of asking what they mean, because they rarely define it. If you look at the linguistic origin of 'sustainable', it really means 'to hold up'. You can sustain things and you can have different categories of sustainability and I am not sure, when they are talking about sustainability, whether that is going to sustain the Public Service or what is going to be sustained.

I am not in favour of across-the-board cuts. I think it is a lazy way of going about things and I hope we do not see a simplistic across-the-board cut to all agencies, because I do not think it is the way to go. I think you have to be more disciplined, more focused, and look at programs and activities that warrant continuance or expansion or those that need to be deleted. So I hope that we do not get this 3 per cent, 5 per cent cut across all agencies—that is not likely—or across many agencies or some agencies. I suspect the agencies that will cop it will be those other than health, and so we will see areas like the environment and agriculture cut again.

I do not claim to be an expert in agriculture, but I take a keen interest. On my right I have one of our leading stud breeders—that is in sheep I am talking about; I should qualify that. Cutbacks, not only at the state level but at the federal level, in research and agriculture concern me. I mean, if we ever want to lead and continue to lead in areas of agriculture and horticulture, you have to invest in research and you have to invest in on-farm support and programs. However, what we have seen in recent years at the federal and state level is a gradual diminution in support for fundamental research. If you drive through the state, you can see research centres that have been given the rough treatment and scaled back.

Members need to realise that we are now importing more fruit and vegetables than we are exporting and we are importing half our fish. That is not a very good indication of a society (an economy, a community, a nation or a state) that is committed to being a major food producer. The way we are going—I think Dick Smith is probably stretching it a little bit, but he is indicating we will not be able to feed ourselves. I do not think we are anywhere near that point, but I think we have to be careful that we do not allow expertise in agriculture, and our skills and so on, to diminish over time. I know the government does not have many members in rural areas, but I do not think that is a reason why they should take it out on agriculture and horticulture in terms of not funding adequate and appropriate research.

I remember the Premier saying a few years ago that he was going to take the sword or the axe to unnecessary committees. I have not seen any recent reporting on that, but I would argue that the state government has many committees that are probably not needed in their current format. I have raised questions about committees like the Dog and Cat Management Board. That is just one, but there are dozens of them. I think it is time the government had a close look at whether we need all these so-called advisory committees. Sure, you need some, but if you are going to have them, have the right ones and have them properly resourced and make sure they do the job.

I think there are a lot of savings that could be made in education, particularly in head office. Clearly you need some coordinated approach in terms of what is offered by way of curricula and so on, but I think our state school education system is far too centralised, far too strongly dominated by our city-based Flinders Street empire. If you give authority and more autonomy to principals and governing councils (which means the parents), you do not need that centralised administration controlling every aspect of what a school does or does not do.

You only have to look at the Building the Education Revolution, which is federally funded but administered through the state, to see that the Catholic system and the private school system have got better value for their projects and finished them well ahead of most of the state schools because they have been allowed to commission their own architects and project managers and get on with the job and get it done.

In fact, I think I have been invited to two private school openings of buildings that are coming up shortly, while the state school system is being forced to drag the chain. This is not a reflection on Rod Hook, as I think he is a fantastic operator, but when you have a centralised system you run into incredible delays and added expense. I think that has been shown with the BER program as administered by the state government.

There are savings to be made. I am not advocating a system where you do not have some monitoring of what happens in state schools; of course you need that. We have it for Catholic schools and for independent schools now. A similar system could operate for state education. I have said it before and I will say it again: if the state school system is not revitalised and parents are not given a real chance to run the school in conjunction with the principals, I think that, in the city in particular, the state schools will gradually wither away. I do not know whether that is the agenda, but that is what will happen.

While I am talking about education, I am passionate about TAFE. However, what I have seen with TAFE during the last decade or so has been happening for over 20 years. I used to have great battles with the treasurer, Stephen Baker, who argued that TAFE was overfunded; I proved that it wasn't. TAFE is a very important powerhouse for skills training in this state, but it has been more than mulesed: it has had some other parts of the anatomy taken away so that it is nowhere near the organisation it was.

TAFE used to make a significant contribution in engineering and a whole range of areas. It has been neutered in many ways, and I think that what has happened to TAFE has been unacceptable and that the priorities need to be revisited. This is despite a silly mistake made by John Howard when he created technical colleges to compete with TAFE on the false basis that the union in TAFE was difficult. They were never difficult in South Australia: they were very constructive, in my view, and I never had a problem with them when I was the minister. We now have a duplicated system when we could have had a much better funded TAFE system, which is what we should be aspiring to.

In regard to health, I think that the bureaucracy has grown. I note that the Minister for Health announced recently that he is going to trim some positions out of health in the administrative area. I think that there needs to be a close look at a lot of those positions. In talking to clinicians at the Royal Adelaide and elsewhere, they tell me that nearly everything they do is bogged down with internal bureaucratic controls and restrictions.

Clearly, you need some people to administer, but I think that, if you look at the Royal Adelaide, we have gone from a situation where you used to have a director of nursing to an army of people—and I am not picking on the Royal Adelaide specifically but just using it as an example—who are involved in health administration.

I notice that in New South Wales and, I think, in Queensland too, they did an analysis and found that there were more administrators in the health system than actual practitioners—nursing, medical staff and so on. I have not looked at the figures here, but one of the issues I have long argued for is that the Auditor-General, in doing the annual analysis for departments, ought to be looking specifically at how many people there are in the front line.

Whether or not people spend their money correctly for the tea fund I do not personally care too much about. I want to know how many police, nurses and doctors are in the front line. However, the way that the Auditor-General's report comes to us now, we do not really get to know the precision that is needed to make a proper judgment about those things.

The health issue is fundamental because if we do not get a handle on it—and when I say 'we' I mean collectively the parliament, the government, the whole caboodle—we will not have enough tax dollars in the future to deal with health issues. As I indicated in this place recently, I am pleased that the health minister and his department have really taken on board the notion of preventative health. He would argue that they have always been focused on it, but he and his department have indicated to me that he is now prepared to look more vigorously at in situ preventative health checks for state government employees. That is not only good for the individual it is also good for the taxpayer, because a lot of money will be saved if people can be prevented from going into hospital, and so on.

So if there is one message that needs to be adopted it is that of preventative health. The state government needs to push this as hard as it can, from the early days at school, from birth (a program of checking newborns was adopted by former minister Lea Stevens). Preventative health needs to be extended and expanded right throughout the school system and, indeed, into the workplace so that people can pick up health issues early and have them dealt with.

In terms of law and order, we still hear too many examples of people in the community doing things of a criminal nature. The government says that it is tough on crime, but it does not seem to be as effective on crime as it should be. Graffiti is as bad as it ever was. People coming into Adelaide on the interstate trains must think we are a mob of hicks. I do not know whether the Premier or the ministers of transport or tourism ever get out and have a look at what those tourists see, but tourists coming in must think this is Hicksville. Wherever you look along those interstate rail lines there is graffiti and vandalism, you cannot read the timetables, things like that.

The government made a commitment, doing the election campaign, to help clean off graffiti but what we would like to do is clean up graffiti vandals. And we do not want people calling them 'graffiti artists'; artists do things legally and proudly show their work, they do not do it at three in the morning and vandalise the transport network as well as private and other public property.

This is a challenge for our new Attorney-General: I believe our courts system needs a fundamental overhaul, and I also believe that there is an opportunity to not only save money but also increase the opportunity for justice in our system. It is a very expensive system, and I think there needs to be a focus on some of the procedures there. I will have a lot to say about that in a month or so after my case is finalised; however, I think there is an opportunity for the new Attorney-General to really look at how the courts could be improved.

Some of their facilities are inadequate. There was a joke the other day about a judge and a convicted criminal being in the same lift; it was only a joke because I think they use separate access and egress facilities. I have not had the pleasure of looking around the Supreme Court—I do not particularly want to—but I am told that some of the physical surroundings there are not too good. However, in a time of priority, and given my fears about the budget, I am not hopeful a lot will happen there.

In terms of transport, I am a great fan of the tram network. I would probably have preferred it to go to the eastern suburbs or other locations, but if a tram to the Entertainment Centre is the start of it going further west than that is fine. I think that in years to come people will look back and say that that was one of the best achievements of the Rann government, despite some people being critical of it and saying that it is a tram to nowhere. Well, if it is a tram to nowhere I am not sure why so many people want to get on it. In time people will say that that was one of the greatest achievements of the Rann government.

Members interjecting:

The Hon. R.B. SUCH: A lot more needs to happen in terms of public transport, not just expanding the tram network. I want to quickly raise a couple of other issues. I have previously raised this issue—and it is a financial matter—of expiation fees as they apply to pensioners and people on low incomes. I do not accept the government's argument that it cannot make adjustments to give those people some concessional benefit; in the age of computerisation I just cannot accept that argument. To hit pensioners and low income earners with huge expiation fees is unfair, and does not suggest a social inclusion policy. To me, it looks more like a social exclusion arrangement.

In respect of funding for the CFS, which is a local issue because I have been on the soapbox, I do not believe the emergency services levy has been fairly allocated to the people in the hills area—and I include the people from Tea Tree Gully right through to the electorate of Mawson. Those people are paying the same as those getting a full-time MFS service, and we are not advocating replacing the CFS with the MFS. The MFS backs up the CFS, but its vehicles cannot go off road.

People in areas from Tea Tree Gully through to Mawson are paying a very large contribution to the emergency services levy, and the figures that have been published in the Hills and Valley Messenger today—that they have calculated; they are not my calculations—reinforce the concerns of local CFS personnel that they are not getting a fair share of the emergency services levy to the point that they cannot train people, and they do not want too many more recruits because they cannot afford to put a uniform on them. When you get to that situation I think there is something wrong in the funding allocation. The emergency services levy funds a whole lot of things, worthy though they may be, but when people are putting their lives on the line to defend areas in the hills right through from Tea Tree Gully to Mawson, it is only fair and reasonable that they be adequately resourced and supported.

In terms of stormwater use, some progress is being made down south. It is much more challenging, I accept, but I hope in a tight budget there can be some money for stormwater retention wetlands on the Glenthorne site, as well as revegetation because, as Professor Paton has pointed out, many of our birds in the Adelaide Hills are under threat and we need revegetation in areas like Glenthorne Farm, much of which is as bare as a baby's backside.

The last point I make is that, apart from a letter from the Premier's Department saying that the celebrations next year for our 175^th birthday will be modest, I hope some money is put aside—and that needs to be done now—with planning in place by all government agencies. Let us celebrate and be proud of South Australia, of what we have achieved and what has happened here. I am surprised that the present government would not want to celebrate what it and former governments have achieved and what the community has contributed. Next year—and we cannot wait until next year to plan for it; let us get on with it now and put in some money for proper celebrations—let us show the world that we are proud of what we have achieved here and how we have led the world in so many areas.

Time expired.

Mr GRIFFITHS (Goyder) (12:18): When the member for Fisher approached me seeking an opportunity to speak, he said that he would be about 10 minutes, but he went a bit longer.

Members interjecting:

Mr GRIFFITHS: I know, I have been conned. Being too much of a gentleman sometimes gets you into trouble. It is a great pleasure to stand and speak on behalf of the people of Goyder and South Australia about the Supply Bill. I am a bit like the member for Davenport: I am rather intrigued about the timing of it all. We know the budget will be presented on 16 September. We know that after the 2006 election the budget was presented also in September. We know that tradition—certainly in the last eight years—has been that the budget is presented in the first week of June or so.

I respect the fact that an enormous amount of work goes in for the three or four months beforehand to ensure that budget bids from the various departments are considered seriously, and taken back to be renewed and reviewed in order to come up with a figure that allows the presentation of a budget that provides the services and infrastructure needed for our state. However, I seriously believe—and I support the member for Davenport in his comments earlier—that this budget should have been able to be presented far earlier than 16 September.

Election processes create time pressures—I understand that—but after some eight years in government, and with a variety of efforts in previous years to reduce costs through the Smith review and through dividends being required of, I think, one quarter of 1 per cent of departmental spend, at other times budgets have been brought down demanding significant dollar savings from within departmental expenditure.

In June last year, when the Treasurer walked in here and presented his eighth budget, he told us about the Sustainable Budget Commission—a group of people paid significant amounts of money per day, in some cases, to work with the challenge of trying to identify $750 million in savings.

These people, it appears, have already reported on some level to the Treasurer. The Treasurer, in answering a question from the opposition in relation to the royalties taxation regime currently in place, stood up and, as part of his answer (especially as it relates to the federal recognition of his suggestion that South Australia was going to change its royalties regime), detailed the fact that the Sustainable Budget Commission was also here to consider revenue. It is not just expenditure but revenue also.

I still think that, in the fullness of time, after eight years of experience, with a government that understands the processes and a variety of ministers who have been there for some time and who also well understand the processes, there should have been the opportunity to present this budget in July of this year at the absolute latest.

That would have been appropriate because then there would have been an opportunity for the people of South Australia to ensure that the budget could be reviewed—a budget which will presumably again be at least in the $15 billion range, given that last year's was $15.05 billion. I am somewhat intrigued, though, that we are being asked to consider a one-page bill that allows for the expenditure of some $5.22 billion in funds (approximately one-third of what the budget will be for the full 2010-11 financial year) without any knowledge of where that money is to be expended, what the priorities may be, where the real necessities exist and without the opportunity for debate to occur.

I am frustrated by that process. I understand that there is the traditional August break when the parliament will adjourn and many people will go back to their electorates, travel or do study tours and that sort of thing, but we are actually here to work on behalf of the community that put us here. That is why I believe that the budget should be presented far earlier.

If the election result had been somewhat different, I (and no doubt Isobel Redmond as the premier) would have demanded that a Liberal government present the budget far sooner than September. It would have worked as diligently as it could to ensure that that was actually achievable. History has told us that, in the 2001-02 financial year, when the Liberal Party was last in government, the budget was in the range of $8.4 billion. History records now that the current financial year shows a budget of $15.05 billion. That reflects an enormous increase in revenues, but also an enormous increase in expenditure.

The member for Waite, when he has spoken in the past, has referred to the fact that the Treasurer has a problem with expenditure and not with revenue. He has relied upon significant windfall gains from property taxation and, indeed, federal government grant revenues which I note have increased in the current financial year by $1.2 billion alone, even in a difficult economic climate. That is why there is a significant jump in our budget.

However, budgets have to be responsible. They have to be framed in such a way that they reflect as accurately as possible what the revenue and expenditure will be and that is where I have had great frustration in the last four years since coming into this chamber and looking at the performances of ministers and governments where expenditure has been significantly above the budget provisions.

I know that there will be members from our side who will stand up and talk about the experience in the commercial world where that level of error would never have been acceptable. Nor indeed can it be when you work with public funds. Those funds, in essence, are more important because the 47 House of Assembly members and the 22 members in the Legislative Council are charged with ensuring that those funds from the public purse are spent appropriately. Unless we have that opportunity to review the budget, I think we are sadly failing the commission that has been granted to us by virtue of our election to this place.

There is no doubt that we are a state that has great potential in the future but, to ensure that that potential becomes reality, we have to put in place a set of policies that encourages investment and encourages business to be successful. Government policy will drive opportunity, but it cannot be a hindrance to it. That is my great frustration.

We have to ensure that the discussions we have, the legislation that is put in place and the policy adopted by the government provide the opportunity for hard work to be recognised, for enterprise to be rewarded and for people to have the opportunity to be successful in their business ventures and, in turn, have the opportunity to employ in numbers.

We have nearly 800,000 people in the state who are unemployed. There will be some challenges in future years to ensure that the workforce that we need is actually going to be available due to the significant numbers who will retire. That is why migration and population increases will be important factors for us. It is important that we provide that framework for businesses to be successful. That is why I have a lot of frustrations with the taxation imposts imposed on business in South Australia.

Much has been said in recent weeks about the federal government's super profit tax on mining. The uncertainty that has created around the nation is frightening, when you look at the share values that have been affected by it. I was listening to an economics commentator on the radio this morning, and he believes that the significant drop in the sharemarket, while also a result of overseas impacts (we understand that we live in a global economy now) is because of the uncertainty in Australia when it comes to mining investment driving down the willingness of people to invest within that industry and, indeed, driving down the value of so many other businesses that are publicly listed. That is where government policy is absolutely critical.

If we look at state taxation regimes since 2001-02 until the 2009-10 financial year, the budget papers identify that there has been a 66 per cent increase in state taxation revenue. The Commonwealth Grants Commission reports, which are updated yearly, reflects also that South Australia regrettably is the highest taxing state in, I think, five of the nine key areas the commission reports on.

Mr Gardner: The IPA report.

Mr GRIFFITHS: The IPA report that came out just after Christmas 2009 identified again that South Australia was the state that makes it the hardest for small business to pay its level of tax because of the tax regimes put in place. It identified, I believe, that we were some 69 per cent above the land tax average for the nation when it came to our businesses.

Mr Gardner interjecting:

Mr GRIFFITHS: The member for Morialta refers to the fact that it is outrageous—and it is. There is so much media commentary about the fact that land tax is a serious disincentive when it comes to employment and, indeed, the willingness of people to own property. Media commentary constantly highlighted the fact that businesses were really concerned about their ability to retain their employment numbers because of land tax. The Liberal Party recognised that. On 9 October last year, after considerable debate in economically challenging times, we came out with a policy that we believed was appropriate to encourage people to invest in property and to give some 55,000 people some level of rebates by completely removing their land tax liability and decreasing the amount paid by people who own property above that $250,000 threshold we proposed would be responsible for the payment of land tax.

At the time, the Treasurer came out and said that the Liberal Party was fiscally irresponsible, that the state could not afford that level of rebate and that we could not do that. But it is amazing (and I am sure that many others will refer to this) that, when polling starts to come out and you get closer to that electoral cycle and start to really feel the pinch at the boundary areas, when you know the marginal seats you have to win or, indeed, the seats that are swinging quite considerably, where for those people it is a really important area, the Treasurer finally is dragged into it. When he presented his Mid-Year Budget Review on 28 January, he told us about an increase in the land tax threshold from $110,000 to $300,000.

The Liberal Party came out and supported that because it was an appropriate move. It was a little better, as it turned out, than our proposal, but it is based upon a very different set of financial circumstances known to the state at that time. When we framed our policy and put it before the people of South Australia, we were not aware of the significant increases projected in GST income that was going to flow through. We have heard since then again—twice, as it has turned out—of significant further increases in the projections across the forward estimates of GST revenue. This is providing the opportunity.

But even then, when the Treasurer put out his figures, he talked about the loss to revenue from land tax of some $52 million per year for the next three years. However, the budget papers from that mid-year review still identified that land tax revenue will increase during that same time by $150 million. So, the Treasurer gives some back, but he pulls in a hell of a lot more. That is, I think, where people are shaking their head in wonderment. They want to operate businesses and they want to own property, but there are people out there who have been seriously scared off because of the fact that government policy is not encouraging it. That has to be a concern for all South Australians, and it has to be reviewed.

I also want to talk briefly about forward estimates on financial borrowings. There can be no doubt that $6.8 billion is a significant amount in anybody's terms. The fact that the forward estimates identified that, at the same time as that $6.8 billion liability is realised, it will have an interest cost of some $711 million per year or, as the Leader of the Opposition says continuously, $2 million per day in interest costs, and that worries people who understand the economics and the impact that will have on South Australia.

We did get to a situation only a few years ago when government debt was down to a very minimal figure. Significantly, it was created through the opportunity created by the Liberal Party making the hard decisions it did in the 1993-2002 period. I recognise that the treasurer got it down to a very low figure, but to allow state borrowings to get a back up to that $6.8 million, without necessarily ensuring that the provision of infrastructure that is required is there, is frightening. All South Australians should have a perspective on that. They need to understand the impost that that interest cost will create upon them.

I just want to talk a little about things that are relevant to me. There has been much debate about the stadiums and the various proposals the Labor Party has put forward for Riverside West and, indeed, the government's counterproposal on 2 December of last year. I will go to my grave believing in the fact that we could have delivered a 50,000 seat covered stadium, incorporating 5,000 car parks, on the rail yards land for $800 million. I believe in that in all sincerity.

It was a proposal that actually excited the people of South Australia. They wanted to preserve the iconic nature of Adelaide Oval. They respected it wonderfully for the cricket ground it provides and for the forum it also provides for SANFL football, predominately for finals. They wanted to ensure that South Australia was brought to the standards that exist in the other states of Australia and that we had a covered stadium that ensured that 50,000 people could sit in comfort at all times and witness our wonderful national game.

Yes, claims and counterclaims occurred. The government proposed that their $450 million was all that was going to be put on the table and 'not a cent more' were the words we continually heard and that agreement had to be reached by 30 June, whereas we are out there trying to sell our vision for Riverside West, which incorporated the stadium and also the revitalisation of the Riverbank precinct to ensure that it became a place for people. That is what it deserved to be.

Again, the government has seen the wisdom in our policy announcements. They have put out some sort of vision that recognises the need to provide that as an open space opportunity for people and for some developments to take place. For us, it was going to be a mixture of developments, a lot of that funded by the private sector. We have certainly all heard of the fact that the casino was interested in a potential move there. The Entertainment Centre and the Convention Centre extensions, all of those things were a great opportunity for South Australia to move forward.

Regrettably, the result from 20 March removed the opportunity for the Liberal Party to provide that to the people of South Australia in the next four years, and it is a tragedy because the vision was an exciting one. Anyone who was able to witness the projections on what we intended to put there could only have believed that this was a state that was actually moving forward and that these were people who actually had a vision for our city and our state and who wanted to make sure that we lived in the best possible place.

We know we live in a great state as part of a great nation, but South Australia needs much more. Yes, our $800 million proposal would have been delivered, whereas the government's comment now is that we are up from $450 million to $535 million with, potentially, additional money coming through from the federal government later on if the FIFA bid for the World Cup is achieved.

Discussions continue about the scope of the development—for example, whether car parking provisions are to be there and whether the SACA and if the SANFL have to put in more money forward. It has confused the issue so much that South Australians must be wondering, 'Why the hell did we vote for that Labor mob, because now they have gone back on their word? They are putting different figures out there. They had said not a cent more, but suddenly it has changed.' I will continually live with that frustration. I hope there is an opportunity to ensure that the riverbank precinct does become the exciting place that it should be and that all South Australians deserve.

I just want to build a little on some economic issues as they affect South Australia. I am very concerned, and I recognise that the shadow minister for industry and trade, the member for Waite, has been talking about export income being down, too, and lots of people talk about that because it is of great concern. In many ways, South Australia has built its economy upon its ability to export products, be they raw products from mining or from agriculture, or the value-added products that give us greater opportunity to employ more people. When you look at the significant drop in export income to our state over the last eight years, without adjusting for inflation, that is a real cause for concern to me.

If we also look at the fact that smaller number of businesses in South Australia are involved in the export business, my recollection is that the national figure is something like 14 per cent but that for South Australia it is more like an 8 per cent margin. That shows that there is a lack of serious encouragement from government to support businesses to make themselves export-ready or there is a concern about policies that are in place, or that we just have businesses that are not willing to challenge themselves to go to that next level of development to ensure that they have a chance to become export ready and to be competitive, internationally and nationally, when it comes to the business and the products that they produce.

South Australia is filled with clever people who undoubtedly have this opportunity to do it. I have absolute faith in the capacity of our community to be willing to challenge itself to move forward, to grow its business opportunities and to provide employment chances to people, but we have to ensure that we create the forum, the skills set, the support base and the people within government who are challenged to ensure that every hurdle is overcome and that we have champions within government and the community to make opportunity become reality. That is what I really want to see.

Within the transport field there is going to be a need for a significant investment in future years for infrastructure: the Superway being constructed at a cost of, I think, $840 million; the Northern Expressway about to be completed soon (and those people who drive on that road all the time will be pleased with that); and the announcement by both political parties during the election campaign for the duplication of the Southern Expressway, some $445 million. All these infrastructure items are appropriate and necessary.

I am concerned about the long-term future of the South Road, involving some 22 kilometres in length; to construct a form of overhead superway would involve billions of dollars in expenditure. We have to ensure that we have the opportunity for improvements in our productivity by getting the infrastructure right and by ensuring that our transport options, including provisions for funding and maintenance of our road network, are there.

Anyone who drives extensively throughout South Australia will have frustrations everywhere they go. There are some great quality roads; I readily admit that, and I recognise the efforts of the Hon. Michael Wright, the former minister for transport. When he had responsibility, he invested some money on Yorke Peninsula, for which I am forever grateful, but there is a need to recognise that our regions need far more support, be it in road infrastructure, ensuring business opportunities, or general infrastructure development to support growth in the community.

I am lucky enough to represent the people of Yorke Peninsula, Adelaide Plains and the Copper Coast area. I am sure I heard the mayor, Paul Thomas, quote this yesterday: he has something like 2.4 per cent population growth per year—I think double the state's figure—and it is because people are making lifestyle choices. Unless the infrastructure is actually keeping up with the number of people wising to locate there, we will have people thinking, 'Yes, I want to move to this area,' but they will go somewhere else where they think they are better served by a range of infrastructure provisions, whether it be roads or, indeed, hospitals.

We on this side have a great concern about the level of support that exists for the regional hospital network. The country health plan of June 2008 was a debacle. The government has revisited that and has put an enormous challenge in front of the health advisory councils to prepare a 10-year vision for health delivery in those communities. Those people, from the feedback I am getting, feel somewhat restricted regarding the supposed budget implications, and I have told the representatives I met that their challenge is to actually prepare a plan that ensures provision of the services they need. The debate about the money required for that purpose is to be held in another place. Overall, enormous challenges are facing our state. I believe that the next budget will be a difficult one also. I have no doubt that retail has suffered considerably in the last two or three months, and we rely upon a very strong economy for transactions to occur to actually drive government revenues.

Mr HAMILTON-SMITH (Waite) (12:38): This Supply Bill comes before the house at a time of mounting concern over the extent of European debt problems, which are just this week sending shudders through global markets, yesterday leaving Australia's sharemarket down by 3 per cent, a 10-month low. Interestingly, the S&P/ASX200 index lost 130 points in a single day to 4,265 points, with the broader All Industries down 126 points; energy and mining stocks worst off with sectors following by 4 per cent and 3.7 per cent respectively. This follows, of course, the first wave of the global downturn in 2008, which saw the most stunning revelations in this chamber by the Treasurer about impacts upon state revenues that have had ongoing consequences.

This Supply Bill comes before us at a time of considerable global and national uncertainty, which raises concerns about the security of revenues, but it also highlights issues to do with risks related to expenditure. Looking back over the last eight budgets, and looking forward to the ninth budget to be introduced by the Treasurer in this Rann Labor government, I observe that the government inherited a very good set of accounts indeed, considering the wreckage caused by Labor and the basket case of a state it left in the early 1990s, following the debacle of the State Bank crisis.

After eight years of sound Liberal government, we fixed the books of account. The Premier and the Deputy Premier took over a very good show, indeed. Looking at each of those budgets, I must say that I think the Treasurer, in his first two budgets, did a reasonable job of getting a grip of the situation. I think he made significant economies and cuts, and prepared the state in productive ways for what could have been a period of sustained investment to actually change the structure of the state economy and position us forward.

Instead, the third and subsequent budgets saw the Treasurer and the Premier let out their belt as fast as they could swallow the cash. The government set about a course of increasing revenues through taxation exponentially and letting out expenses by hiring extra people, growing the size of government, and introducing a range of inefficiencies. As fast as that tax revenue fell over the counter at the Treasurer, he swallowed it and let out his belt. The result is that our relative productivity, our relative position to other states, is virtually unchanged or declining. Our share of the national cake is falling. Our slice of the national economy is winding back. The structural changes that were needed have not been made.

My colleagues the member for Davenport and the member for Goyder have covered a number of points, and I will just reiterate some of them. For example, the growing state debt that the Treasurer and Premier are accruing is heading towards $7 billion, more in the out years, and, yes, that is starting to approach State Bank levels. Admittedly, as a percentage of GSP, it is not as severe, but the fact is that, instead of covering its expenses through efficient government and efficient management of the state's affairs, the government is again falling back to Labor's traditional backstop: debt.

Labor is going to reap $591 million in state taxation revenue over the next four years—including an extra $156 million in land tax revenue—above what was budgeted just last year, according to the Mid-Year Budget Review. We will have to wait for the Treasurer's budget in September, unfortunately, to see the current state of affairs. I note that, according to the Mid-Year Budget Review, we are now in a deficit on all three accounting measures. I have previously criticised the Treasurer for being in deficit on two; it is now a trifecta, with a net lending deficit of over $1.5 billion, a cash deficit of over $1.6 billion, and even a net operating deficit of $174 million.

State revenues have increased by $606 million in the 2009-10 budget, but spending has also increased, getting back to the point that I have consistently made to the house that this government does not have a revenue problem. Even during the economic crisis that we have just endured, and continue to endure, revenues have continued to grow, thanks to a profligate federal Labor government borrowing on behalf of the Australian people and throwing the money at state treasurers as quick as it can. Revenue has continued, and that has enabled expenditure to continue. We are living on borrowed time, thanks to this Premier and this Treasurer.

In this period, grants from the commonwealth have increased by $1.2 billion (just from 2008-09 to 2009-10) from $7.25 billion to $8.45 billion. These commonwealth bailouts, as I have mentioned, have made the Rann Labor government far better off in net revenue terms. People need to be very clear on this. It is not, as the Treasurer would have us believe, that he is running a good show; it is, rather, that Kevin Rudd (the Milky Bar kid) is throwing money at the Treasurer faster than he can spend it.

A massive $3.9 billion on top of that has been collected from state government revenue sources above and beyond what the government planned to collect. So, this Treasurer has consistently, over eight years, said, 'I'm going to raise X amount of dollars from revenue this year,' and consistently the figure has come up as X plus 10 per cent or X plus 20 per cent. He cannot even accurately estimate how much money he is going to get in from these profligate taxes each year, to the point that it is now $3.9 billion since 2002. Even the Auditor-General remarked upon it in his 2008-09 report. On page 12, part C, he states:

Over the past six years the state government has received large amounts of unbudgeted revenues that have enabled net operating surpluses.

There it is, from the Auditor-General. Of course, part of the reason is the extraordinary hike in taxes: a 66 per cent increase in taxes over the last eight budgets. It is worth running through them. Despite the hailed reforms of payroll tax, there has been an extra 50 per cent of tax take—up from $601 million to $903 million in those eight years; taxes on property, up a striking 110 per cent; taxes on gaming, 29 per cent; taxes on insurance, 52 per cent; and taxes on motor vehicles, a serious concern for all families and small businesses, up 39 per cent.

This government has been on a splurge, with a taxes intake of stunning proportions. According to the IPA, South Australia is the most severely taxed state for businesses, more harshly taxing than the basket case state of New South Wales. South Australia's businesses pay 4.8 per cent more state business taxes than the national average and 11 per cent above the tax liabilities seen in WA. The average business in SA pays over $247,000 in state taxes and, according to the IPA, the average SA business land tax liability is 69 per cent above the national average and a massive 536 per cent above land tax liabilities in WA.

Why would you open a business in South Australia, when you can do it in WA and enjoy this type of benefit? That is why, under this Treasurer and Premier, work on the Northern Expressway is preoccupied with contractors who are outbidding local contractors from Melbourne, Sydney and Brisbane, because they have lower fixed costs in those states, and they can come in here and bump off our people, who are having to pay higher land tax bills, higher WorkCover bills, higher taxation at large, and get the work—our work, paid by our taxpayers—to build our roads and desalination plants. That is the effect that this government has had on small businesses and families in this state, through its mismanagement of the state's fiscal affairs.

An issue that should be brought to the house's attention is what is going on with water. We know that water prices are to be doubled and have increased already by 113 per cent under the Rann Labor government. However, the house needs to be reminded that since 2002-03 the total amount stripped by this government out of SA Water as general taxation revenue has exceeded $2.2 billion. SA Water and water charges have simply become a cash cow for the government. When people pay their SA Water bill, 30 to 35 per cent of it is simply tax revenue to the government. Thank God they no longer run the electricity system, or the taxpayers of South Australia would have their pockets emptied at the same pace.

I want to turn my attention to Shared Services and other services that the government and the Treasurer proposed. They have consistently failed to meet their savings targets—and that is the Auditor-General talking. He says again and again in his 2008-09 report that savings targets have simply not been met. How on earth is this government going to find the $750 million worth of cuts it hopes to identify and then execute it through the budget review commission? They have not been able to do it for eight years—the Auditor-General has confirmed that—and now they are going to identify $750 million worth of cuts, and they say they are going to achieve them. Well, let's see.

The great mistake of this government, of course, back at the very beginning, as I said, was that as fast as they swallowed the cash they let out their belt. They hired all these extra people—nearly 16,500 of them. They grew the size of government and went to 15 ministers for the first time in the state's history, all of whom needed their shoes polished and their affairs attended to. Yes, we did hire some extra nurses, teachers, doctors and police officers—about 5,500 in accord with natural growth—but that does not account for the nearly 11,000 additional public servants employed under general administration. The problem here is that once you let go of the system, once you over-hire, as any business operator knows, it is hard to turn back the clock; it is hard to unscramble the egg.

I could go on about unfunded superannuation liabilities and the mismanagement of the WorkCover scheme. I could go on about so many things that this government has mismanaged but I will leave that for others in response to the Supply Bill. I simply say that this government and this Treasurer really do need to get a grip. This state faces very dire national and international fiscal circumstances at present.

Our exports have plummeted from over nine billion eight years ago, before this government came to office, to 7.9 billion today; that is a 23 per cent decline in the past 12 months alone. It is interesting to break that up. Meat and meat preparations are in difficulty; wheat is down 44 per cent in the past 12 months; wine is down nearly 13 per cent; wool and sheepskins are down 5 per cent; machinery is down nearly 3 per cent; metals and metal manufacture is down 30 per cent; fish and crustaceans are down 11 per cent, partly thanks to the new quota that the Rudd Labor government has agreed to for tuna fisheries; road vehicles, parts and accessories are down a stunning 84 per cent; petroleum—we closed Mobil—is down as well.

In other areas there is nothing but decline. Our exports are in serious trouble and with it there are problems with respect to jobs. This leads me to the observation that there appears to be two stories about the state economy at the moment: one story is very much a surface story about stimulus spending—the building of school halls and other government and public investment, whether it is trams or roads—designed to get us through the current downturn. Combined with that there is the issue of historically low interest rates. Although they have risen, they are still at historic lows, and low fuel prices.

Those three things together have created a bubble in the state economy that has kept job levels at reasonable levels, keeping in mind that to be defined as employed you only need to have a job for one hour a week. There has been an enormous shift from full-time to part-time employment which has created a sense (a bubble) that things are okay in the state economy. However, when you look beneath that superficial story there is another story: a story of declining exports, the loss of Bridgestone, the loss of Mitsubishi and the loss of the Mobil refinery.

It is a story of declining employment in some of our core industry sectors. For example, in agriculture, food and fisheries the change in full-time employment over the past 12 months is down 9,400 from the period November 2008 to November 2009; manufacturing is down 13,900. Even mining has experienced a decline in jobs (2,900) and the retail trade has also deteriorated (9,800)—and this is in full-time employment. From November 2001 to November 2009 the figures are equally startling.

What we are seeing is a decline in full-time employment in some of our core industry sectors, those upon which we rely and which are being replaced by casual and part-time employment in stimulus-related expenses which largely relates to public investment. This is a worrying sign, because one asks what will be left when the stimulus funding ends and the interest rates and the fuel prices we currently enjoy rise—as will inevitably occur.

I have some comment to make about the next four years of fiscal management under this government. My first bit of advice would be to abandon the hospital project: it is not too late. This $1.7 billion project as it is touted—I am sure it will be significantly more—is essentially a hire purchase agreement. We are going through a PPP process to finance this entire deal.

It is $1.7 billion plus nearly $200 million to clean up the site—call it a $1.9 billion or $2 billion hospital. I am sure that it will be much more at the starting point but, by the time we have paid for it 30 years later, it will be many billions more. Even the operation of the hospital is to be privatised and financed in what amounts to a hire purchase agreement. There is no revenue stream from it. It will be paid for from the health budget.

Members opposite on the government benches will be gone, the Premier will be the ambassador in Rome and the Treasurer—God knows—he will probably be in a bar in New York. I do not know where members opposite will be, but we on this side of the house will be trying to pay the bill out of money destined for doctors' and nurses' wages. I say to the government: don't do it, rebuild the Royal Adelaide Hospital.

By the way, do not give us one football stadium for the next 50 years; do not leave us with one stadium. Even though Melbourne has Etihad Stadium and the MCG, they have just completed a third stadium. It is not a vision for the next 50 years. We need a separate dedicated stadium at a separate site. It should be in the rail yards. If you must build the hospital, find another city site but, with the amount of money you are talking about, you can afford to give us a dedicated second stadium.

By the way, members opposite should think more in visionary terms about the future and deliver a budget in September that gives us a vision for the central business district of Adelaide, that gives us the prospect of ring roads around the city that are so desperately needed, that gives us a vision for the upgrading of the north-south axis from Wingfield to Victor Harbor so that traffic can flow freely and that gives us a vision for the state that includes regional South Australia.

Instead of focusing on trams, the government should think about our bus system and our broader public transport system. In fact, it should go back to all the things in the master plan for Adelaide that was announced by the opposition in February 2008 and give this state a future.

This Supply Bill finances a government that at the moment has no vision and, because of the things it has undertaken to do, stands to expose this state to extraordinary risks—risks which they will not have to deal with but which they will leave as wreckage for others to clean up.

Debate adjourned on motion of Hon. M.J. Wright.

[Sitting suspended from 12:58 to 14:00]